The 10 worst betrayals in high tech

Tech-minded backstabbers abound. Don't get caught this Ides of March with your back turned to the wrong vendor, partner, or customer

The 10 greatest betrayals in high tech

The Ides of March are upon us, which can mean only one thing: Watch your back. In the high-tech world, treachery abounds -- whether from companies betraying customers, businesses knifing their partners in the back, or acquisitions that quickly turn into exterminations. Here are 10 of the worst.

Reuters Photographer

Tech betrayal No. 1: Et tu, Redmond?

When Microsoft agreed to develop a graphical user interface with IBM in 1985, the computing giant probably had no idea the software upstart was developing its own GUI to compete with it. But OS/2 flopped and Windows soared.

When IBM and Microsoft severed their joint development agreement in 1991 there were 13 million copies of Windows 3.0 in the wild, versus 600,000 of OS/2. Companies that had bet the bank on developing for OS/2, like Lotus and WordPerfect, got their legs cut out from under them. By the time their products reached Windows they were late, buggy, and slow. Microsoft owned the desktop OS and, eventually, cornered the productivity software market as well, thus beginning its transition from spunky upstart to cutthroat monopoly.


Tech betrayal No. 2: Steve Jobs doesn't give a fig about the Newton

The second coming of Steve Jobs didn't start auspiciously. One of his first acts after being re-anointed as Apple CEO in 1997 was to kill the Newton MessagePad. Thousands of angry Newtonians reacted by gnashing their teeth, holding up their orphaned MessagePads to protest the betrayal at Macworld conventions, and writing 5,500-word obituaries for the device.

While Jobs later made up for it with the iPhone and the iPad, the Newton still carries a special mystique in the hearts of longtime Apple geeks, inspiring a tech cult that lives on today.

Reuters Photographer

Tech betrayal No. 3: WorldCom displays no taste for accounting

It was just a little creative accounting. In 2002, WorldCom deliberately overstated its revenue by nearly $4 billion, creating what was then the largest accounting scandal in U.S. history. Along the way the kings of "dark fiber" betrayed employees, customers, creditors, shareholders, and other telecoms before ultimately filing for bankruptcy.

After the scandal, CFO Scott Sullivan lost his job, while former CEO Bernie Ebbers (pictured) began serving 25 years for fraud and conspiracy at a Club Fed prison in 2006. Remember when guilty executives actually paid for their crimes? Those were the days.

Reuters / Brian Snyder

Tech betrayal No. 4: Verizon's unlimited data plan has its limits

It sounded too good to be true, and it was. Back in the mid-2000s users who had tethered their mobile broadband dreams to a Verizon EVDO device found themselves booted from the service for exceeding the limits on their "unlimited" data plans. In 2007 the State of New York spanked Verizon for this practice and forced it to reveal its secret 5GB limit. These days, of course, all unlimited data plans appear to have limits. Also in limited supply: consumers' patience for this BS.

Reuters Photographer

Tech betrayal No. 5: Microsoft proves Vista Incapable

In 2006, Microsoft threw buyers of new Vista machines under the PCI bus to prop up Intel. Running Vista's spiffy new interface required new graphics hardware. But Intel couldn't produce enough new graphics processors, so it persuaded Microsoft to redefine the specs for PCs labeled "Vista capable." A class-action lawsuit followed, revealing dozens of emails from Microsoft execs who knew exactly what pedigree of dog Vista was. Microsoft ultimately won the legal battle, but it lost the war when the troubled OS became one of Redmond's biggest flops.

Reuters / Brendan McDermid

Tech betrayal No. 6: Yahoo's Circus Maximus

The Roman Senate had nothing on Yahoo. The Web 1.0 giant's biggest investors have no qualms about pulling out the knives and carving up CEOs. Like Carl Icahn did in June 2008, when he tried to oust Chief Yahoo Jerry Yang to force an acquisition by Microsoft. Or, more recently, when Yahoo investor Dan Loeb gutted new CEO Scott Thompson just five months after he assumed the big chair in January 2012. Thompson's mistake: He fibbed on his résumé, claiming a computer science degree he did not possess. Our advice to Marissa: Sleep with one eye open and a knife under your pillow.

Reuters / Susana Bates

Tech betrayal No. 7: There goes the Sun

For Sun Microsystems fans, being acquired by Oracle in April 2009 was like Luke, Hans, and Chewbacca being acquired by the Darth Vader. Sun was the champion of open source projects like Java, MySQL, and Open Office. Oracle was the home to the dark lord of proprietary software, Larry Ellison.

Oracle immediately sued Google over Java patents (and largely lost -- the case is now on appeal). By September 2010, most OpenOffice developers had abandoned the project in favor of an Oracle-free version called LibreOffice. Last November, the original author of MySQL, Michael Widenius, accused the database giant of trying to smother his open source baby. When you're dealing with the Galactic Empire, that's called business as usual.

Reuters / Robert Galbraith

Tech betrayal No. 8: Facebook's incredible shrinking privacy

At one time, Facebook was the most private social network in the world. If you didn't have an email address ending in .edu, not only could you not join in on the fun, you couldn't see anyone else's fun either. Things have changed a bit since 2005, as Matt McKeon's interactive graphic shows.

Facebook's information grab reached its apex in April 2010 when it introduced the Like button for third-party websites, capturing the stuff you do outside of Facebook as well as within. But as Facebook's privacy protections shrank, its privacy data-use policy swelled to an astounding 9,349 words. Our three-word summary: Facebook privacy? Fuhgeddaboudit.

Reuters / Stephen Lam

Tech betrayal No. 9: HP shows Palm the back of its hand

Like an orphan child shunted from one foster home to another, Palm thought it had finally found a home when HP bought it in April 2010. Longtime Palm aficionados rejoiced; the world's biggest PC maker could afford to not only shelter Palm but also produce handsets and tablets based on the promising WebOS.

But this Dickens story has no happy ending. A scant five weeks after introducing the Touchpad tablet, HP shut the whole thing down, spun off the remnants of the WebOS into a new company called Gram, then sold that to LG last month for use in smart TVs. Who knows? Maybe its next 60-inch flat screen will come with a stylus.

Reuters / Kimberly White

Tech betrayal No. 10: You only hurt the ones you iLove

Remember when Apple and Google were BFFs? It wasn't that long ago. Until August 2009, then Google CEO Eric Schmidt sat on Apple's board. Jobs and Schmidt even shared the occasional cup of joe together. That was when Google was still an Internet giant and Apple was a hardware and OS company.

After Android handsets began appearing everywhere, though, Jobs vowed to go "thermonuclear" on Google and spend every dollar Apple had trying to destroy the Google OS, according to his biography. But it was one victory Jobs did not live to see. Android now commands 51 percent of the worldwide smartphone market, more than double Apple's 24 percent.

Copyright © 2013 IDG Communications, Inc.